Foreclosures may mean a slow down in new homes

By LINDELL KAY - Daily News Staff

Published: Sunday, February 10, 2013 at 12:03 PM.

He said the widening of Piney Green should mean reasonable growth in single family units in that area.

However, from a multifamily unit standpoint, current occupancy figures show a growing vacancy rate that may cause a lag in any new multifamily developments unless the homes are along the waterfront or provide a specialty product, Woodruff said.

“The military buildup brought strong growth to the Jacksonville community,” he said. “The drawdown will slow that growth.”

The national housing market is faring better, according to information provided at last week’s 2013 Economic Forecast sponsored by Jacksonville-Onslow Economic Development.

County Manager Jeff Hudson said it was good to hear projections that the national housing market is rebounding with home prices rising on a national level. Whether that will play out locally is undetermined.

Woodruff said the local economy remains strong due a long-term military presence and looks to diversify with new players who are being attracted to the community.

Onslow County foreclosures jumped nearly 70 percent from 2011 to 2012 causing officials and those in the housing industry to believe local new house construction will slow down in coming months.

Using a homebuyer tax credit, a lot of folks purchased homes in the past few years they really couldn’t afford, said Christina Asbury, co-owner and broker at Exit Independence Realty in Jacksonville.

“They jumped into those new homes and now we are seeing most foreclosures coming from military members who are being re-stationed or leaving the military,” she said.

Most of the 193 homes in foreclosure in Onslow County involve veteran loans. Ninety-nine of those are attached to a bankruptcy, according to real estate statistics at foreclosure.com, a website listing houses in distress.

Asbury said banks held off foreclosures during the beginning of 2012, but uncertainty over the presidential election and whether Congress would be able to navigate the fiscal cliff led to a run on foreclosures that rippled through Jacksonville beginning in October.

While there were short spikes in the number of foreclosures in May and August, the bottom fell out in October when there were 106 foreclosures on Onslow County homes. There were 24 in October 2011. The 2012 foreclosure rate remained on a doubling pace in November and December, seeing 49 and 46 foreclosures compared to 28 and 22 in the same months a year earlier.

The huge jump in the number of foreclosures was a byproduct of bank action and a time when local Marines were receiving new marching orders, Asbury said.

“Unfortunately, a lot of people just figure it would be better to let the bank take the house,” she said.

At one point the Jacksonville housing market was such that someone couldn’t sell their home because a newer, less expensive house with more amenities was being built down the street. But now major developers are beginning to back out of the area, Asbury said.

“We should see building slow down soon,” she said, “and a definite drop in building permits as the bigger developers pull out of Jacksonville.”

In the last three years, more than 1,000 apartment units were constructed in Jacksonville, primarily in the Western Boulevard corridor. Single family construction was strong in the Carolina Forest and Williamsburg areas, according to information from the City of Jacksonville.

But beginning in the latter part of 2012, the city hasn’t received any new proposals for multifamily projects.

“We continue to see a trend for new single family subdivisions,” said City Manager Richard Woodruff. “While resale of homes has experienced a longer time for market consumption, new homes continue to be strong in market uptake.”

He said the widening of Piney Green should mean reasonable growth in single family units in that area.

However, from a multifamily unit standpoint, current occupancy figures show a growing vacancy rate that may cause a lag in any new multifamily developments unless the homes are along the waterfront or provide a specialty product, Woodruff said.

“The military buildup brought strong growth to the Jacksonville community,” he said. “The drawdown will slow that growth.”

The national housing market is faring better, according to information provided at last week’s 2013 Economic Forecast sponsored by Jacksonville-Onslow Economic Development.

County Manager Jeff Hudson said it was good to hear projections that the national housing market is rebounding with home prices rising on a national level. Whether that will play out locally is undetermined.

Woodruff said the local economy remains strong due a long-term military presence and looks to diversify with new players who are being attracted to the community.

“Overall the city feels positive about the year ahead,” he said.

Contact Daily News Senior Reporter Lindell Kay at 910-219-8455 or lindell.kay@jdnews.com. Follow him on Twitter and friend him on Facebook @ 1lindell.